Nikkei Dips on Stronger Yen; Japan, Turkey in $20 Billion Nuclear Plants Deal

Chandrasekhar Atreya
24 Dec, 2010
New York City

Tokyo indexes declined today and in the week as the yen strengthened against the dollar and the euro. Japan and Turkey are expected to sign agreements to build $20 billion nuclear power plants. 91.41 trillion yen budget proposal for 2011 to be approved today.

[R]5:00 PM Tokyo, Japan – Tokyo indexes declined today and in the week as the yen strengthened against the dollar and the euro. Japan and Turkey are expected to sign agreements to build $20 billion nuclear power plants. 91.41 trillion yen budget proposal for 2011 to be approved today.[/R]

Tokyo stocks dropped again today pushing the key stock index down on a stronger yen due to lack of global direction stemming from intervening Christmas holidays.

The Nikkei 225 Stock Average dipped 0.65% or 67.29 to close at 10,279.19, and for the week the index fell 0.2%. The broader Topix lost 0.5% to 901.66 and had its first weekly drop of 0.2% in four weeks. In a weak trading only 32 members of the Nikkei index closed higher.

The dollar dipped to as low as 82.86 yen in New York and the euro weakened to 108.46 yen, near the lowest level in December.

The Cabinet is holding extraordinary meeting to approve fiscal 2011 budget this evening. The budget with record spending of 91.41 trillion yen is more by 100 billion yen than the initial budget for the fiscal year 2010.

Japan signed an agreement with Turkey for civil nuclear cooperation in a possible step towards $20 billion deal for Japanese companies to build a nuclear facility in Turkey, an official said.

The non-binding agreement was reached in Tokyo between Economy, Trade and Industry Minister Akihiro Ohata and Turkey’s visiting energy minister Taner Yildiz, earmarking a Black Sea coast location for the plant.

Domestic PC shipments rose 3.8% in November from a year ago month to 698,000 units, record fifteenth monthly increase in a row, the Japan Electronics and Information Technology Industries Association said today.

The government in Japan and the ruling Democratic Party of Japan agreed today to cap highway toll for passenger cars at 1,000 yen on weekends and holidays and at 2,000 yen on weekdays.

Koichiro Gemba, Chairman of DPJ’s Policy Research Committee, and Transport Minister Sumio Mabuchi agreed to lower the ceiling for holidays and weekends to 1,000 yen today.

The Ministry of Economy, Trade and Industry gave approval today to Tokyo Electric Power Co to start building a new reactor at the Higashidori nuclear power station in Aomori Prefecture.

The builder TEPCO will submit its constructions plans to the Nuclear and Industrial Safety Agency which may take about a month to approve the design.

Foreign investors were net buyers of Japanese stocks for the week December 12 to December 18, the seventh week in a row of increased purchases, the Finance Ministry said today.

Net purchases by foreign investors totaled 3.92 trillion yen, exceeding the net sales of 3.70 trillion yen.

Nearly 30% of consumer loan applicants were denied loans after the new lending laws came into effect, a survey by the Financial Services Agency shows.

The law requires that the balance of lending to an individual be kept under one-third of his or her annual income.

Stock Movers

Kyocera Corp, maker of electronic equipments, dipped 1.06% to 8,420 yen, while Honda Motor Co also lost 1.06% to 3,265 yen. Nissan Motor Co dipped 1.26% to 785 yen.

Mitsubishi UFJ Financial Group In fell 0.68% to 440 yen after surging 14% in the past two weeks.

Mitsui O.S.K Lines Ltd, the operator of the world’s largest merchant fleet, dropped as much as 2.46% to 554 yen, after Goldman Sachs Group Inc cut its rating to ‘sell.’

Toshiba Corp surged to its highest level in three weeks after the company reported that it will outsource fabrication of system chips to Samsung Electronics Co. The stocks closed up 0.7% to 441 yen.

Canon Inc gained 1.76% to close at 4,340 yen, while Inpex Corp added 2.96% to close at 486,500 yen.